Indiana has often won low grades for the overall health of its residents. However, a group of Hoosiers, led by Vice President Mike Pence, is having a major impact on the future of federal health care policy.
Dwight Adams/IndyStar

WASHINGTON — Several Hoosiers in key positions in the Trump administration, led by Vice President Mike Pence, are negotiating the future of federal health policy despite the state’s mixed reputation on health care.

In addition, the state for years has ranked among the least healthy. Hoosiers smoke more, are less active and die sooner than most Americans.

Before Pence became vice president, however, he was among the minority of Republican governors who expanded their state’s Medicaid program — a move which gave hundreds of thousands of Hoosiers access to health care and helped the state respond to the HIV outbreak.

Pence has been a leader of the Trump administration’s so far unsuccessful efforts to repeal the Affordable Care Act, including phasing out its Medicaid expansion — a program Pence’s successor is using to fight the opioid addiction epidemic.

Seema Verma speaks during a swearing-in ceremony, officiated by U.S. Vice President Mike Pence, in the Vice President's ceremonial office at Eisenhower Executive Building March 14, 2017 in Washington, DC. Verma has been sworn in to be the administrator of the Centers for Medicare and Medicaid Services for the Trump Administration.(Photo: Alex Wong, Getty Images)

Seema Verma, the Indiana health care consultant who now heads the Centers for Medicare and Medicaid Services, has been trying to sell the Medicaid changes to lawmakers and governors while working with states to loosen federal requirements on Medicaid programs. Verma’s deputy chief of staff is a former Pence aide, as is the director of Medicaid who previously served as Pence’s health care policy director.

Another former Pence health policy aide now helps Health and Human Services Secretary Tom Price — a good friend of Pence’s — work with Congress on the agency’s legislative agenda.

Long-time Pence aide Matt Lloyd, the top HHS spokesman, is the “sherpa” to help guide the Trump administration’s surgeon general nominee through Congress.

“It’s certainly significant,” Eliot Fishman, the CMS official during the Obama administration who worked with Indiana on granting approval for its alternative Medicaid program, said of the concentration of Hoosiers in health policy positions. “But, for myself, I was hopeful that having people who had successfully negotiated, and then implemented, an innovative Medicaid expansion in Indiana would have led to more support for Medicaid expansion nationally. I have not seen evidence of that yet.”

Tom Miller, a health policy expert at the right-leaning American Enterprise Institute, said it’s understandable that so many Pence people ended up in key health care positions.

“It didn’t light up President Trump as the thing he was most deeply invested in, and had a range of experience in,” Miller said. “Mike has some experience, knowledge and engagement in this area of policy — more so than most other folks close the issue in the White House. So it’s not surprising that he is taking the lead on this.”

Indiana is home to some significant players in the health care industry. Anthem, one of the largest insurance companies, is headquartered in Indianapolis, as is drug maker Eli Lilly and Co.

Warsaw, Ind., is known as the “Orthopedic Capital of the World” because of the concentration of medical device makers.

And health savings accounts, the tool Republicans have championed as a way to make consumers more invested in their health care decisions, were pioneered by an Indiana insurance entrepreneur as an alternative to traditional health insurance.

Yet, despite Indiana’s leadership in sectors of the health care industry, the state ranks near the bottom on many health measures.

Not surprisingly, the category that stands out the most to Paul Halverson, dean of Indiana University’s Richard M. Fairbanks School of Public Health, is public health funding. Indiana’ ranks 49th on spending per capita on preventive and education programs that improve health.

“We just have not prioritized public health funding in Indiana in a number of years,” Halverson said. That’s despite the fact, he said, that studies show properly funded public health systems can reduce medical care expenditures and increase life expectancy.

The HIV outbreak in Southern Indiana put a spotlight on the weaknesses in the state’s health infrastructure.

Still, Halverson gives a lot of credit to Adams — the state health commissioner poised to become the nation’s top doctor — for how he worked with Pence to respond to the outbreak. The response included allowing needle exchanges despite Pence’s initial reservations.

“(Adams) was the one, in my view, who helped the governor understand the scientific aspects related to syringe exchanges,” Halverson said. “My hope is that they can continue to work together in a way where Vice President Pence can be assisted by a surgeon general who he knows and trusts and who can assist the administration in better understanding the health options that we face.”

Pence’s successor, Gov. Eric Holcomb, has made reducing the number of opioid deaths one of his top goals as governor.

But Holcomb’s strategy to fight the opioid epidemic relies heavily on Medicaid, the jointly funded state and federal program which Pence is pushing hard to curtail.

Pence’s support, as governor, for expanding Medicaid in Indiana was a departure from his congressional record. He had voted against adding a prescription drug benefit to Medicare and against expanding the health care program for lower-income children whose families make too much to qualify them for Medicaid.

Still, Pence never completely closed to the door to finding a way to accept the federal funding made available through the Affordable Care Act to expand Medicaid eligibility.

“Clearly, Gov. Pence had policy concerns about expanding Medicaid,” said Brian Tabor, executive vice president at the Indiana Hospital Association, which pushed hard for the expansion. “But he never said `no.’”

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Indiana Gov. Mike Pence is shown announcing on Sept. 3, 2013, that the state has negotiated with the federal government on an extension of the Healthy Indiana Plan through 2014, to cover uninsured Hoosiers.(Photo: Charlie Nye / The Star)

“Despite being a conservative state, they — generally speaking — overcame their conservative credentials to support policies that expanded coverage for people, even though they did it with a conservative flavor to it,” said Andy Slavitt, who headed the Centers for Medicare and Medicaid Services under former President Barack Obama.

Whether Pence’s program, which requires participants to make monthly contributions if they want more comprehensive coverage, works better than traditional Medicaid is still being evaluated.

But Verma knows how crucial the ACA funding was to making the expansion possible, said Fishman.

“There was just no way from a budgetary perspective that Indiana could have expanded coverage … at the regular (federal reimbursement rate),” Fishman said.

That’s not something Pence and Verma talk about as they’ve tried to sell lawmakers and governors on replacing Obamacare with legislation that would phase out the ACA’s extra federal funding for Medicaid while also reducing the federal government’s financial support for regular Medicaid.

Governors who heard their pitch at this month’s National Governors Association summer meeting were skeptical.

“He was selling ice beverages in the wintertime,” Miller, the think tank expert, said of Pence. “(Governors) wanted to know how they were keeping the money they already had, and they were trying to tell them they’d be better off, even though it seemed like they were getting less. That’s hard to pull off.”

Pence — who has been traveling the country and holding roundtable discussions at the White House to highlight the “Obamacare disaster” as well as courting lawmakers by phone and in private dinners at his residence — has been more active than Trump in trying to pass repeal-and-replace legislation. He played a key role in getting changes to the House bill so it could pass that chamber in May. But the Senate’s version is stalled.

If Senate Majority Leader Mitch McConnell, R-Ky., can’t round up enough GOP votes next week to bring any health care bill to the floor, legislation may be shelved for the foreseeable future. That will shift the focus to the changes the administration is able to make through agency action.

Pence and Verma have told governors the Trump administration will be more permissive — and act faster — on state requests to try new approaches.

“It took our state more than two years for the federal government to approve our waiver,” Pence told governors at the summer meeting. “And even then, they frankly, rejected an awful lot of what we were trying to do.”

Fishman, who called the negotiations he conducted with Verma on Indiana’s request intense but ultimately successful, said that experience likely contributed to Verma’s commitment to letting states test their own approaches. But he suspects the administration will push the limits on the federal rules they’re allowed to waive under the law.

“It’s likely that there will be litigation,” he predicted.

Slavitt, who like Fishman has been a vocal opponent of the repeal and replace efforts, said it would be a mistake to take too much of an ideological approach to policy changes.

“If people come to the job and do what they did in Indiana, which is focus pragmatically on how to expand coverage,” he said, “that would be a good thing.”

Contact Maureen Groppe at mgroppe@gannett.com. Follow her on Twitter: @mgroppe.

Hoosiers in key federal positions to shape health care policy:

Mike Pence: As vice president, Pence has a lead role in the Trump administration’s effort to undo the Affordable Care Act. Pence has been more active than Trump both publicly and privately in trying to get repeal and replace legislation through Congress. As governor, Pence was among a minority of Republicans who took federal funding made available under the Affordable Care Act to expand Medicaid.

Seema Verma: The administrator of the Centers for Medicare and Medicaid Services, Verma has been helping the administration explain to lawmakers and governors the Medicaid changes proposed in legislation. She’s also encouraged states to seek permission from her office for local approaches to running Medicaid. A former Indiana-based health care consultant, Verma helped create Indiana’s alternative Medicaid program and worked with other states on unique approaches.

Brady Brookes: Brookes is Verma’s deputy chief of staff. She was legislative director for Pence when he was governor.

Brian Neale: Neale is a deputy CMS administrator, overseeing Medicaid and the health care program for low-income children whose families make too much to qualify for Medicaid. When Neale was Pence’s health care policy director in the governor’s office, he and Verma negotiated permission from the Obama administration to expand Indiana’s alternative Medicaid program.

Tyler Ann McGuffee: A former health care policy director for Pence, McGuffee works on Health and Human Services Secretary Tom Price’s legislative agenda and is a liaison between Congress and the agency.

Matt Lloyd, principal deputy assistant secretary for public affairs at the U.S. Department of Health and Human Services.(Photo: Provided by the U.S. Department of Health and Human Servies)

Matt Lloyd: Spokesman for the Health and Human Services Department, Lloyd was Pence’s deputy chief of staff in the governor’s office and worked for him for years on Capitol Hill. In addition to his spokesman’s job, Lloyd is helping shepherd Trump’s surgeon general nominee through the Senate confirmation process.

Dr. Jerome Adams: Indiana’s state health commission has been tapped by Trump to be the next surgeon general. Adams was appointed to his state position by Pence.